Interview with Automotive Art Executives on Tackling the Biggest Challenges of Global Expansion
If managing a mid-sized retail chain in one country is not difficult enough, try managing one across multiple countries in the Caribbean and then throw in a plan to expand aggressively into the U.S. and Canada.
That’s the challenge faced by Automotive Art, one of the largest retailers of car enhancement products and services in the Caribbean. Founded in 1990, it trades in over 65 countries, with 18 franchise stores throughout nine of them.
We’ve recently had the pleasure of chatting with two Automotive Art executives – Hugh Blades, the Director of Control & Inventory Logistics who co-founded the company with Dereck Foster, and Doug Armstrong, the current Chief Executive Officer.
Find out their solutions to the biggest challenges of global expansion in our interview with them below.
How did Automotive Art get started and how did you get involved?
Hugh: “Automotive Art started in 1990, when Dereck Foster and I bought out the paint, shop and accessories side of my father’s and uncle’s business. They were mostly selling plumbing supplies, so it was easy for them to part with that aspect of their business.
After the buyout, we partnered with a paint manufacturer called Harris Paints to combine our sales expertise with their manufacturing capabilities. It was a good match, and we moved from there.”
What do you think makes Automotive Art special within its market?
Doug: “There’s nothing like it in the Caribbean. A similar business in Canada would be Canadian Tire, although we don’t do housewares since we focus more on the automotive business. This includes dealing with things like tires, batteries, wheels and paint. So, pretty much everything except for actual car parts.
Our competitors, on the other hand, only specialize in one thing, such as tires for instance. So, we are an operation that brings all these different bits together in one store.”
Can you talk a little about your franchise locations and how that came about?
Hugh: “Becoming a franchisor helped our once-small company increase its buying power on equipment and set a great price for everybody. We had a system that worked very well, which allowed us to expand across nine markets and 18 stores. But, managing a franchise is a lot of work, especially now, with so many locations.”
What was the biggest challenge of growing beyond one location?
Doug: “Many business people look at the Caribbean as a group of tiny disjointed islands that don’t do much in terms of business, but taken together they can represent a lucrative market. So, the biggest challenge was being able to manage all the different cultures, languages and levels of technology and make sure they all talk to each other, to create a platform for effectively servicing the market.”
How do you keep the same level of service across all your locations and businesses?
Doug: “Every year, we spend a lot of time, money and effort on ongoing training. In every new market, we are dealing with staff who, in many cases, are not coming from an educated background.
So, we have to do a lot of training to get people up to speed – from something as simple as good manners to more complex operations like managing entire retail stores.
Though it can be expensive at times, we recognize it as a challenge and deal with it accordingly on all platforms. On the other hand, our competitors just wing it and hire external trainers and consultants, who do not understand their market or company culture, which is why they are having such a tough time growing out of their comfort zone.”
Your relationship with Magstar goes back to 1999. Can you talk a little about the beginning of this relationship?
Hugh: “We became acquainted with Magstar in 1999, and since then, it’s been instrumental to our continued success.
We’ve always had a lot on our plate. We have 11 different companies, some of which specialize in parts and some of which specialize in service. We also have to deal with wholesale management, manufacturing and franchising across multiple countries, which involves accounting for different taxes, currencies and so on.
So, to make our life easier, we wanted to bring all these disparate elements together in one standard system, and that was Magstar.”
In what way does Magstar help you address some of your big challenges right now?
Hugh: “With Magstar, it’s very easy to consolidate all our efforts – because it essentially works the way we do. Plus, there aren’t that many IT companies that provide the same level of support that we get from Magstar. I can pick up the phone to call the support at any time – and get all the help I need without any issues.”
Were you using any software before Magstar, and if so, why did you decide to switch?
Hugh: “We were using a system called ASA, which unfortunately did not do everything we wanted it to do. As our business grew, we continued having more and more issues with that system, so we had to switch to something else.”
How does Magstar help you with warehouse and supply chain management?
Hugh: “Magstar has added an improved warehouse management system that we are now looking to implement.
The basic one is great too. You can set replenishment orders and reports, with everything automatically rendered overnight. So, when the guys come in the morning, they know where to find everything, what they have to pick up and which store to send it to.
The creation of purchase orders is also seamless. Again, there are reports that you can automatically create, with your purchase orders depending on the sales numbers. We can also reorder by min-max and more.
Overall, it’s very easy to use once you know what you’re doing.”
What’s your favourite aspect of the software?
Hugh: “The fact that it’s an all-in-one system, with great reporting capabilities. It’s very easy to change anything that needs changing in the system, so I don’t need to fiddle with anything for too long.
I’m also looking forward to the warehouse improvement that’s coming up.”
What’s your relationship with the people at Magstar?
Hugh: “Great! Whenever we have a problem, they deal with it right away. I can call them at any time and they will respond because the support is 24/7. What’s even better is that they usually fix problems quickly – sometimes within minutes.”
As you’re planning to expand across North America, what role do you think Magstar will play in that?
Hugh: “To expand our remote sales in North America, we will need to be able to move our products efficiently, which will require opening additional warehouses. So, having a robust warehouse system is going to be crucial for us. We are now looking to implement one with Magstar, which should help us manage all that.”
How has Magstar changed your life?
Hugh: “I can accomplish a lot more in a lot less time. It certainly made my life a lot easier – just ask my wife. And each day it gets better!”
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